Proposal to tax e-cigarettes stalls in the Legislature

Now 19, Saez said he was able to quit smoking cigarettes last July, and he credits the use of electronic cigarettes, or vaping. He recently started work at the Vaporium, an e-cigarette store, in Lakewood.

“Now, my whole reason to get up in the morning is to help people get off cigarettes,” Saez said. “There’s a feelings I can’t describe, somewhere between accomplishment and pride” when customers tell him they haven’t smoked a cigarette for months.

E-devices work by heating an oil, or e-liquid, that emits a vapor and then is inhaled. The oil usually contains nicotine, but nicotine-free oil is also available. Common ingredients used in the oil includes propylene glycol, vegetable glycerin, and other flavoring agents, all ingredients approved by the U.S. Food and Drug Administration.

E-cigarette proponents advocate vaping as a low-cost, healthier alternative to smoking tobacco. Ten milliliters of oil, the approximate of three and a half packs, only costs $8.

According to the state Department of Health, vaping may not be safer than cigarettes, citing unproven claims of safety, unknown long-term health risks, and the possible inhalation of nicotine and other harmful chemicals during use as concerns.

In the Legislature, proposed House Bill 2795 would have taxed tobacco substitutes, such as e-cigarettes, at 75 percent. A 95 percent tax was originally proposed. The bill would have allowed devices prescribed by a licensed physician to be exempt if the Food and Drug Administration approves e-cigarettes as tobacco-cessation devices. Revenue would have gone towards education.

The bill passed out of the House Finance Committee by a 7-6 vote. All the Republicans members of the committee, along with one Democrat, Rep. Chris Reykdal, D-Tumwater, opposed it. The session ended without further action taken on the measure in either the House or the Senate.

Reykdal said taxing e-cigarettes would unfairly target low-income people who are making a healthier choice. He said the bill is just about generating more tax revenue.

Until the Food and Drug Administration clarifies the health effects of e-cigarettes, “there is no good public policy reason to load up a tax on these products,” Reykdal said. “It would have a huge adverse effect on” these businesses.

Rep. Gerry Pollet, D-Seattle, a member of the House Finance Committee, said the tax is important for public health, education funding, and limiting access to minors, which are likely to be attracted to available flavors like bubblegum, and drawn in by cartoon advertisements.

“It’s a win on all three fronts,” he said.

Pollet said the unregulated e-cigarette industry has avoided conducting the long-term studies necessary to get approval as a tobacco cessation device, but still want to market it that way.

“You can’t have it both ways,” he said.

According to a study by the Centers for Disease Control, use of e-cigarettes by middle school and high school students has more than doubled between 2011 and 2012, increasing from 4.7 percent to 10 percent.

A fiscal analysis estimated the tax could have generated more than $30 million in revenue by 2018.

Steve Thompson, co-owner of Vaporium with his wife, Kim, said the tax would have put them at a competitive disadvantage, especially against online sales. They would have considered moving their business out of state if the law had passed, according to Thompson.

“It’s very rewarding, having a business doing something you’re passionate about,” he said. “I sleep very well at night.”

Thompson said one of their sayings is “our best customers quit us,” and he estimates they have about 100 customers per day, the majority of them are former smokers who switched to e-cigarettes.

The Food and Drug Administration is expected to issue regulations on e-cigarettes soon.